Credit Suisse will pay restitution to investors in the scandal involving bonds used to fund the purchase of tuna fishing boats in Mozambique.
At least one lawsuit is off the table for Credit Suisse (CS), the «Financial Times» (behind paywall) reported Monday, with the bank agreeing to pay compensation of $22.6 million to investors. The deal was signed off by a New York court on Friday.
Tuna Bonds
The case goes back to 2013 with Credit Suisse and Russian investment bank VTB arranging $2 billion of loans to Mozambique to establish a tuna fishing industry and develop recently discovered offshore natural gas fields. Companies took out loans to buy equipment using state guarantees which were issued without the approval of the country's parliament, according to the «Financial Times».
The scale of the debt was discovered in 2016. Companies had collapsed and subsequent defaults led to years of financial upheaval in Mozambique as aid was cut off by donors, the report said.
Further Progress
In October of last year, Credit Suisse agreed to pay $475 million in fines to authorities in the US, UK, and Switzerland while forgiving $200 million of debt to Mozambique. The bank entered into a deferred prosecution agreement with the US, while the European subsidiary pleaded guilty to committing wire fraud, according to the report.
On Friday, Credit Suisse stated that completing this restitution as part of that settlement «marks further progress in our efforts to deal with legacy issues and to focus on executing our strategic plan for clients, colleagues and investors», according to the «FT» report.
